Experience gained outside the family business can be a plus

Welcome to our weekly small business blog, which looks at issues affecting the entrepreneurial economy in Northeast Ohio and beyond.

They've seen the light

A Lyndhurst company provides much of the color for this Wall Street Journal story about the value family-owned companies get from having children of entrepreneurs work for other companies before joining the family enterprise.Craig Aronoff, co-founder and chairman of the Family Business Consulting Group in Chicago, tells that newspaper that he encourages young people from family businesses to do this to broaden their perspectives."Part of it is becoming your own person and part of it is learning about other ways to conduct business," he says. "If you stay inside the business, other employees will potentially see you as having a privileged position."The Journal notes that before Matt Bursky joined his father's retail and installation company, Cleveland Lighting LLC, in 2003, he spent six months interning at a manufacturing firm in the same industry."You see things from the other side, from the manufacturer's perspective," he says.When Mr. Bursky later began working for his dad, he started at the entry level. "I was a salesperson with zero accounts," he tells The Journal. "I was the lowest person on the totem pole."

Mr. Bursky didn't expect to stay long, noting, "Initially it was going to be a starting point for my career. I wasn't sure what direction I wanted to go in."But eight years later, Mr. Bursky is a 50% owner of the 15-employee company. He works next to his father six days a week. "We interact on a daily basis," he tells the newspaper. "We definitely get along well." Mr. Bursky, 30 years old, says he and his father are a complementary team. He brings an understanding of technology and marketing to table, while his dad contributes decades of lighting-industry and sales experience. Mr. Bursky tells The Journal that he recently won his dad's approval to launch a company website and online store, which is live.

If you're dubious about medical marijuana …

Scott Shane, the A. Malachi Mixon III Professor of Entrepreneurial Studies at Case Western Reserve University, makes a cogent case on Bloomberg Businessweek's website for remedying what he calls “the federal government's bias against the owners of medical marijuana dispensaries.”Prof. Shane endorses two pieces of legislation that he says would help in this regard. U.S. Rep. Jared Polis, D-Colo., has introduced a bill that would permit medical marijuana sellers to borrow money from banks. (As Prof. Shane notes, “dispensary owners aren't prohibited from applying for bank credit. The trouble is anti-money laundering statutes intended to stop illegal drug dealers make banks reluctant to do business with legal dealers.”) A second bill, from U.S. Rep. Pete Stark, D-Calif., would allow medical marijuana sellers to deduct business expenses from their taxes.There are four reasons to pass these bills, Prof. Shane writes, starting with the basic issue of fairness.“No small business owners should be denied access to financing or be subject to unfair tax rules simply because they run a business that some in government don't like,” according to Prof. Shane. “The government should create a level playing field for all business owners. As Polis explained when introducing his bill, ‘It is simply wrong for the federal government to intrude and threaten banks that are involved in legal transactions.'"

He also writes that it's “perverse that the government favors the tobacco business over the medical marijuana industry when the former is responsible for several costly medical problems and the latter provides a medically prescribed treatment.”The final two reasons to support the bills? “By blocking the growth of the medical marijuana industry, federal policy makers are missing a golden opportunity to encourage entrepreneurship,” according to Prof. Shane. Finally, he writes, “By opposing the medical marijuana industry, the federal government is missing the chance to cut government expenditures and raise taxes in one of the few areas where such actions would face little opposition by business owners.”

Safety first

A lot of small business owners apparently have a false sense of security.Aol.com's Small Business page runs a story that contends business owners “seem confused about exactly what constitutes security when it comes to crucial business data.”Newtek Business Services' latest SB Authority Market Sentiment Survey asked small businesses, "Do you have data or critical information, software or hardware in your physical office, like a server, a tower or a hard drive, that may not be secure?" More than three-fourths (78%) said "no," and only 22% said "yes."Yet when asked, "Is all of your critical computer hardware, software and data stored and backed up offsite?" just 21% of small business owners surveyed said it was, while 79% said it was not.As the piece notes, “If your data isn't backed up, it's not secure. Period.”You also can follow me on Twitter for more news about business and Northeast Ohio.

Morning Roundup

Business headlines from Crain's Cleveland Business and other Ohio newspapers — delivered FREE to your inbox every morning. Sign up for the Morning Newsletter.